By: Nadeemy Haded
Tesla CEO Elon Musk is approaching taking the first tranche of $ 346 million of stock options under an unprecedented bonus package, after electric car maker shares have more than doubled in the past three months.
Tesla shares had risen 9 percent to a record high level, Monday, and they need to rise another 6 percent to reach the market value of the company's shares to 100 billion dollars, and then maintain that level for an average of one month and 6 months alike in order to activate the entitlement to the first tranche of 12 options chip possessed Mask to buy Tesla shares.
Mask has already achieved an operational objective that is also necessary to merit options.
In order for the holder of each of the following slides to be entitled under the terms of the 2018 package, he must continuously increase the company's market value by $ 50 billion over the 10-year agreement period, with the billionaire earning the full package value if Tesla's market value reaches $ 650 billion with the car maker's achievement Electrical has several goals in terms of revenue and profits.
The total amount owed for Mask, who also has a majority stake in SpaceX for the missile industry, who is CEO, will exceed any payments previously made by a US executive, according to Institutional Shareholders Services, a consultancy that had recommended investors to reject the reward agreement. timely.
Mask does not receive any salary or cash rewards, but only options worthy of building on the market value of Tesla and achieving the company's growth goals.
The amount Musk might charge can be compared to what Snape's founder Evans Bigel got in 2017 after the $ 638 million initial public offering.
In 2018, Robert Eiger, CEO of The Walt Disney Company, received a bonus share of $ 149.6 million, including bonuses for Disney's acquisition of Fox Film and Television assets.
He transformed Tesla's mask from a small car maker facing production problems to a global player in the field of electric cars, factories in the United States and China, and has so far managed to continue to advance on more established competitors such as BMW and Volkswagen.
Last week, the market value of Tesla shares exceeded about $ 89 billion, bypassing General Motors and Ford together for the first time, after surprising profits in the third quarter of the year and advancing at a new factory in China and better car deliveries than expected in the fourth quarter.
But many investors remain skeptical of Tesla's ability to generate profits, cash flows and sustainable growth.
Tesla was worth about $ 53 billion when shareholders agreed to the bonus package in January 2018 at a time when the company faced a liquidity crisis, production disruptions and intense competition.
And he considered the goal very ambitious at the time if it involved increasing the value of the company up to 10 times in 10 years.
Last year, Mask achieved two main operating goals, with revenues exceeding $ 20 billion, adjusted earnings before interest, taxes, depreciation, and debt consumption of $ 1.5 billion over 4 consecutive seasons.
Musk currently owns about 34 million shares in Tesla, equivalent to 19 percent of the company, and the bonus package will allow him to buy an additional 20.3 million shares if all options are due.